UPU E-Commerce Forum : Keynote Speech
26 March 2014, Berne, Switzerland
Ladies and gentlemen,
It is a tremendous pleasure and a great honour to be here with you in Berne this morning. I would like to thank the UPU Director-General, Bishar Hussein, for his kind invitation to participate in this Forum, and to take this opportunity to renew the long-standing cooperation between our two organizations.
UPU and ITU are the two of the oldest of all the international organizations – ITU was founded in 1865, and UPU was founded just nine years later, in 1874, so together we have a mutual history spanning almost 150 years.
We share a common history and a common present. While some countries split their post and telecoms authorities over past decades, in others the postal and telecoms authorities continue to report through the same Ministry.
Above all, I believe that we share a common and mutually-reinforcing future, as we work towards building a global information society where all the world’s people are connected.
Ladies and gentlemen,
Post offices are a facilitator of international communications and trade and offer a range of important services both to citizens and to businesses.
Outside of major cities and towns, post offices are often the main or only physical presence of government in a community. The post office therefore serves as an essential service, connecting citizens and businesses to one another, the government, and the rest of the world.
There are about 650,000 post offices in the world, and about 500,000 of those are in developing countries.
In recent times, the traditional post office business model has come under substantial threat, as letter volumes declined with the advent of electronic communications – from email and text messages to the whole range of social media.
The recent global economic and financial crisis further deteriorated the conditions in letter markets, with postal operators losing up to 20% of their letter traffic due to the economic downturn, and forecasting losses of another 30% over the next decade.
But every cloud has a silver lining – and in the case of postal services, this has come in the shape of the rapidly expanding world of e-commerce.
E-commerce is of course equally vital both to postal services and to the ICT sector, and now makes up a significant – and rapidly-growing – part of global economic activity.
Indeed, the latest forecasts from the digital research company eMarketer suggest that global e-commerce business to consumer sales will rise by just over 20% this year, to top 1.5 trillion US dollars in 2014, and will rise to over two trillion dollars by 2016.
And the good news for the postal sector is that the overwhelming majority of the goods bought online around the world reach their final destination via postal services, taking advantage of the world’s largest physical distribution network.
In addition to the shipping and delivery of goods, post offices also play an absolutely crucial role in delivering electronic and financial services, especially in the developing world.
Indeed, the postal network, through its worldwide coverage and the combination of electronic, financial and physical dimensions, ensures that all citizens can have access to efficient, reliable, secure and affordable electronic communication and payment services.
As you know, more than 70% of national postal authorities now view digital services as strategic and have added such services to their offerings.
While digital services currently contribute only around 1.5% of the average post’s global revenues, some posts report that e-services already generate upwards of 30% of revenue.
In the fallout from the financial crisis in 2008 and 2009, postal services – and increasingly postal banks – have widely been seen as being trustworthy.
At a time when many other institutions have forfeited their customers’ trust, postal financial institutions now offer retail banking services to almost a billion customers worldwide; this is close to 20% of the global total of five billion bank accounts.
It is therefore no surprise that post offices are seen as critical to spreading financial inclusion and empowering communities to reduce poverty – especially rural and remote areas.
And let’s not forget that there is still huge untapped potential in this market – with well over two billion people globally still without access to even basic banking services.
Most of those people live in rural and remote areas, which are also home to most of the developing world’s post offices; around 80% of post offices in developing countries are outside the main cities, unlike banks, which tend to focus on large population centres.
So this is a tremendous opportunity, and it’s an opportunity that really fulfils both UPU’s and ITU’s mandates to bring affordable connectivity services – in the largest sense of the word connectivity – to all the world’s people.
Ladies and gentlemen,
Let me close with a few words about ITU-UPU cooperation, past, present and future.
ITU has worked closely with UPU for many years, and it was a great pleasure to welcome UPU as one of the founding members of our ‘Connect the World’ initiative back in 2005. That event also saw UPU’s launch of the International Financial System electronic money-transfer service, which benefits millions of remittance workers around the world.
We have also worked on a number of joint projects together to enable rural telecommunications, ICT services and entrepreneurship development in Africa, as well as projects to modernize post offices in India and Afghanistan.
Today, ITU and UPU are renewing our partnership, with a workplan to develop new international standards for mobile money and launching projects to test new, innovative, sustainable business models for post offices to deliver ICT enabled services in rural and remote communities.
The revised Memorandum of Understanding – which we are signing today – includes:
- Creating international standards for financial transactions, including mobile money;
- Setting up projects to test new business models for sustainable connectivity (paid for by financial transactions), as well as projects in e-commerce; and
- The possible use of .post email services to replace current ITU membership email services.
This is a tremendous opportunity for two venerable institutions to step together boldly in the 21st century – and to make the world a better place for all citizens, and especially those living in rural and remote areas.
Let me thank you once again for this opportunity to be here today – and I look forward to seeing the outcomes of this forum.